As published in Scotsman Guide's Residential Edition, January 2010.
It has come to my attention that we've used this space in the past three Januaries to write about rapid change for mortgage brokers, pink slips and pink slips again. Sorry for setting the yearly tone like that.
I'd like this year to be different. Who in their right mind wouldn't?
And certainly, some of those differences have presented or will soon present themselves, for better or worse.
A few weeks back, Fannie Mae announced it would outright reject loans from borrowers with credit scores of less than 620. Previously, its minimum was 580. Its M.O.: Reduce risk exposure.
That also has been the mantra of Federal Housing Administration (FHA) Commissioner David H. Stevens, he who told a Mortgage Bankers Association Annual Conference crowd this fall that he'd "made more steps in two months toward risk management than FHA had in a decade."
Stevens outlines a few of those steps in our Q&A with him this month. Among them: potentially shifting broker oversight from the FHA to FHA-approved lenders themselves, not to mention increasing the required net worth for these lenders to $1 million in the short term and to $2.5 million in roughly the next three years. DES Financial Services' Darrin Stobaugh touches on these in more depth in his article.
One FHA change taking place as of Feb. 15 (moved back from Jan. 1, as per a change in late December) relates to valuation, with the administration adopting a Home Valuation Code of Conduct-style rule that bars brokers from ordering appraisals for FHA loans (sctsm.in/FHAjan). Does that mean brokers are shut out from the valuation landscape altogether? Not so.
This month, we welcome Solidifi U.S. President and longtime Mortgage Bankers Association Master Faculty member Griff Straw to Scotsman Guide's residential edition. His new Valuation Insight column will go behind the scenes to share with you a new valuation- and appraisal-related issue each month.
That's not the only positive difference we're looking to make this month.
For the duration of January, we're asking all Scotsman Guide readers to share their good news by participating in our Top Originators 2009 ranking of the most-successful brokers, loan officers, bankers and originators. With help from former Mortgage Originator Magazine editor David Robinson, we'll publish the results in print and online in April. If you've done well this year or simply done at all, we urge you to enter your 2009 volume and production information at scotsmanguide.com/TOlist.